In fact, according to the latest annual Demographia International Housing Affordability Survey housing in New Zealand is still severely unaffordable. The survey gave New Zealand a median multiple of 5. All major [cities] in Australia and New Zealand, as well as Hong Kong, were judged to be severely unaffordable.
By contrast, the politics of Keynes and Keynesianism has been treated sketchily and indirectly, if at all. This is surprising, especially in the light of accumulating evidence that tends to support the hypotheses that may be derived from elementary analysis.
Our purpose is to fill this void, at least to the extent of initiating a dialogue. We shall advance our argument boldly, in part because our central objective is to introduce a different aspect of Keynesianism for critical analysis. Those who feel obligated to respond to our prescriptive diagnosis of economic-political reality must do so by taking into account elements that have hitherto been left unexamined.
The book is concerned, firstly, with the impact of economic ideas on political institutions, and, secondly, with the effects of these derived institutional changes on economic policy decisions. This approach must be distinguished from that which describes orthodox normative economics.
In the latter, the economist provides policy advice and counsel in terms of preferred or optimal results. He does not bother with the transmission of this counsel through the processes of political choice.
Nor does he consider the potential influence that his normative suggestions may exert on the basic institutions of politics and, through this influence, in turn, on the results that are generated. To the extent that observed events force him to acknowledge some such influence of ideas on institutions, and of institutions on ideas, the orthodox economist is ready to fault the public and the politicians for failures to cut through the institutional haze.
We reject this set of blindfolds. We step back one stage, and we try to observe the political along with the economic process. We look at the political Edition: The prescriptive diagnosis that emerges suggests disease in the political structure as it responds to the Keynesian teachings about economic policy.
Our specific hypothesis is that the Keynesian theory of economic policy produces inherent biases when applied within the institutions of political democracy. To the extent that this hypothesis is accepted, the search for improvement must be centered on modification in the institutional structure.
We cannot readily offer new advice to politicians while at the same time offering predictions as to how these same politicians will behave under existing institutional constraints. By necessity, we must develop a positive theory of how politics works, of public choice, before we can begin to make suggestions for institutional reform.
In our considered judgment, the historical record corroborates the elementary hypotheses that emerge from our analysis. For this reason, we have found it convenient to organize the first part of this book as a history of how ideas developed and exerted their influence on institutions.
We should emphasize, however, that the acceptability of our basic analysis does not require that the fiscal record be interpreted in our terms.
Those whose natural bent is more Panglossian may explain the observed record differently, while at the same time acknowledging that our analysis does isolate biases in the fiscal decision processes, biases which, in this view, would remain more potential than real.
Some may interpret our argument to be unduly alarmist. We hope that events will prove them right. As noted, we are pessimistic about both the direction and the speed of change. But we are not fatalists. This book is written in our faith in the ability of Americans to shape their own destiny.Keynes, John Maynard ( – ) John Maynard Keynes was a British economist whose ideas have fundamentally affected the theory and practice of modern macroeconomics, and informed the economic policies of governments.
Apr 13, · “It doesn’t matter whether a cat is white or black, as long as it catches mice.” I was reminded of this quote from Deng Xiaoping by the debate between Simon, Brad and Unlearning Economics over the role of mainstream economics.
For me, what matters isn’t whether economics is mainstream or not, but whether it does the job of explaining reality. World for weather forecast. moisture, pressure, temperature, Wind, cloud, sun, communication.
The Stanford Encyclopedia of Philosophy has an excellent new entry up by Samuel Fleishacker on “Adam Smith’s Moral and Political Philosophy.”The whole thing is worth reading, including the extremely helpful summary of Smith’s complicated moral theory as developed in his Theory of Moral Sentiments.
But for most readers of this blog, it is the fifth section on Smith’s political. John Locke – ideas, knowledge and the limits of science. The theory of value before Adam Smith. Sewall, Stephen Parmelee. Fielding on the mechanization of discourse. Sfekas, Stanley.
“Robert Emmet’s copy of John Locke’s Two treatises of government. Schools. History of liberalism; Contributions to liberal theory.